May 25, 2017 – Singapore’s economy clocked a quicker-than-expected 2.7 per cent growth in the first quarter of 2017 from a year earlier, helped largely by continued strength in the manufacturing sector, data from the Ministry of Trade and Industry (MTI) showed today.
The ministry also said it will maintain its gross domestic product (GDP) forecast for the year at 1 to 3 per cent, with growth likely to expand more than 2 per cent “barring the materialisation of downside risks”. Singapore’s trade reliant economy grew 2 per cent last year, propped up by a year-end turnaround in manufacturing activities.
While economic growth in the first three months of 2017 slowed from the 2.9 per cent expansion seen in the previous quarter, the year-on-year GDP figure still outperformed the Government’s earlier estimate of 2.5 per cent and was in line with a Reuters poll of economists.
Roy Moore, director of trading at Evergrand Capital said: “Singapore’s growth should be sustainable due to an improved external environment, despite domestic factors presenting significant challenges. Moving forward, we expect domestic demand to remain the primary driver of growth.”
On a quarter-on-quarter seasonally adjusted basis, the economy shrunk 1.3 per cent, a reversal of the strong 12.3 per cent rebound in the preceding quarter but better than the official advance estimate of a 1.9 per cent contraction. Economists polled by Reuters had expected GDP growth to contract 1 per cent in the first quarter.
Across sectors, the manufacturing industry remained the key driver of growth, with year-on-year expansion of 8 per cent. That was primarily driven by the electronics and precision engineering clusters, which expanded on the back of robust global demand for semiconductors and semiconductor manufacturing equipment, MTI said.
On a quarter-on-quarter basis, the manufacturing sector contracted by 1.5 per cent, pulling back from the 39.8 per cent expansion in the preceding quarter.